Georgia homeowners struggling with debt may soon have a new path to financial relief.
House Bill 1024 (HB 1024), signed into law by Governor Brian Kemp, significantly increases the amount of home equity that Georgia residents can protect when filing bankruptcy. The law takes effect July 1, 2026, and represents one of the most substantial updates to Georgia’s bankruptcy exemption laws in years.
For many homeowners who previously believed bankruptcy was not an option because they had too much home equity, HB 1024 could completely change the analysis. While bankruptcy laws are distinct from injury claims, a Duluth, GA personal injury lawyer may help individuals understand how a pending settlement or personal injury recovery could affect their overall financial situation and long-term planning.
What Is HB 1024?
HB 1024 amends Georgia’s bankruptcy exemption statute, O.C.G.A. § 44-13-100, by increasing the state’s homestead exemption amount. The law raises the exemption from $21,500 per person to $50,000 per person, effective July 1, 2026.
Georgia is an “opt-out” state, meaning residents filing bankruptcy generally must use Georgia’s exemption laws rather than the federal exemption system. These exemptions determine how much property a debtor can protect during a bankruptcy case.
The homestead exemption specifically protects equity in a primary residence.
Understanding Bankruptcy Exemptions
One of the biggest misconceptions about bankruptcy is that people automatically lose everything they own.
In reality, bankruptcy exemptions exist to allow individuals and families to keep certain assets while obtaining debt relief. Exemptions protect property that lawmakers consider necessary for maintaining a basic standard of living.
Examples of property commonly protected through exemptions include:
- Clothing
- Household furnishings
- Personal effects
- Certain retirement accounts
- Vehicles up to statutory limits
- Equity in a primary residence
The amount of equity protected can be especially important for homeowners considering Chapter 7 bankruptcy.
The Current Law vs. The New Law
Prior to July 1, 2026, Georgia homeowners can exempt:
| Filing Status | Current Exemption |
| Individual Debtor | $21,500 |
| Married Couple Filing Together | $43,000 |
Beginning July 1, 2026, homeowners can exempt:
| Filing Status | New Exemption |
| Individual Debtor | $50,000 |
| Married Couple Filing Together | $100,000 |
This more than doubles the protection available to many Georgia homeowners.
Why This Change Matters
The housing market has changed dramatically over the past several years.
Many homeowners who purchased homes before the recent surge in property values have accumulated substantial equity. While rising home values are generally positive, they can create complications in bankruptcy cases.
In a Chapter 7 bankruptcy, a trustee may be able to sell non-exempt assets to repay creditors. If a homeowner has equity exceeding the available exemption amount, that excess equity can become a significant issue.
For years, Georgia’s $21,500 exemption often failed to reflect modern home values. A homeowner who qualified for Chapter 7 a decade ago might no longer qualify today simply because their home’s value has increased. HB 1024 updates the exemption to better reflect current economic realities and housing prices.
An Example of How HB 1024 Could Help
Consider a homeowner with a house worth $350,000 and a remaining mortgage balance of $290,000.
Their equity would be:
$350,000 value – $290,000 mortgage = $60,000 equity
Under the old exemption:
- Protected equity: $21,500
- Potentially exposed equity: $38,500
Under the new exemption:
- Protected equity: $50,000
- Potentially exposed equity: $10,000
For married homeowners filing jointly, the results can be even more dramatic. A couple with $90,000 in equity may have been concerned about bankruptcy under the old exemption structure, but could potentially protect all of that equity under the new $100,000 exemption. Every case is different and requires a detailed legal analysis.
Who Should Revisit Their Bankruptcy Options?
HB 1024 may be especially important for people who:
- Previously consulted a bankruptcy attorney and were told they had too much home equity
- Own a home that has significantly increased in value over the last several years
- Have mounting credit card debt
- Are facing collection actions or lawsuits
- Are considering Chapter 7 bankruptcy, but were concerned about protecting their home
- Have delayed filing because of exemption concerns
If you received advice regarding your eligibility for Chapter 7 bankruptcy months or years ago, that advice may need to be reevaluated after July 1, 2026.
Chapter 7 vs. Chapter 13 Considerations
The increased exemption amount may have the greatest impact on Chapter 7 bankruptcy eligibility.
Chapter 7 is often referred to as “straight bankruptcy” because it allows qualifying debtors to eliminate many unsecured debts relatively quickly. However, asset-protection concerns can sometimes make Chapter 7 less attractive to homeowners with significant equity.
By increasing the amount of protected home equity, HB 1024 may allow more homeowners to pursue Chapter 7 while maintaining ownership of their primary residence. Whether Chapter 7 or Chapter 13 is the better option depends on each person’s income, assets, debts, and financial goals.
Additional Inflation Adjustments
Another noteworthy aspect of HB 1024 is its inclusion of a mechanism for future inflation-based adjustments. Rather than allowing exemption amounts to remain stagnant for years, future increases can help the law keep pace with changing economic conditions.
This helps prevent the exemption from becoming outdated as property values and costs of living continue to rise.
Timing Matters
Because HB 1024 becomes effective July 1, 2026, timing may be an important consideration for individuals contemplating bankruptcy.
Someone who files before July 1 may be subject to the existing exemption limits, while someone who files after the effective date may be able to take advantage of the increased protection. Bankruptcy timing decisions should always be made with the guidance of qualified legal counsel because many factors beyond exemptions can affect the outcome of a case.
Schedule a Bankruptcy Consultation
If you have been told in the past that you did not qualify for Chapter 7 bankruptcy because of the amount of equity in your home, the new protections under HB 1024 may change your options. Every bankruptcy case is unique, and a professional review of your assets, debts, income, and home equity is the best way to determine whether you may benefit from these changes.
The attorneys at Burrow & Associates can evaluate your situation, explain how Georgia’s updated exemption laws apply to your case, and help you understand your available debt relief options. Contact us today to schedule a bankruptcy consultation and learn whether the July 1, 2026, exemption changes could impact your eligibility for Chapter 7 bankruptcy.
Frequently Asked Questions
When does HB 1024 take effect in Georgia?
HB 1024 becomes effective on July 1, 2026. The increased homestead exemption amounts apply beginning on that date.
How much is Georgia’s new bankruptcy homestead exemption?
The exemption increases to $50,000 for an individual debtor and up to $100,000 for qualifying married homeowners filing jointly.
Does HB 1024 guarantee that I can keep my home in bankruptcy?
No. The homestead exemption is only one factor in a bankruptcy analysis. Income, debts, property ownership, liens, and other legal issues must also be considered.
Should I wait until after July 1, 2026 to file bankruptcy?
Possibly, but timing decisions should be based on your specific circumstances. An attorney can evaluate whether waiting would provide a meaningful benefit.
If I was previously denied Chapter 7 eligibility, should I get a new review?
Yes. Homeowners who were previously advised that excessive home equity prevented a Chapter 7 filing should consider obtaining an updated analysis after the new exemption takes effect.
